General equilibrium pricing of nonredundant forward contracts

We derive the general equilibrium of a dynamic financial market in which the investors' opportunity set includes nonredundant forward contracts. We show that Breeden's (1979) consumption‐based CAPM equation for forward contracts contains an extra term relative to that for cash assets. We name this term a strategy risk premium. It compensates investors for the (systematic) risk that stems from their very portfolio strategies when the latter involve nonredundant forward contracts. We also show that Merton's (1973) multibeta intertemporal CAPM must be amended for forward contracts to exhibit adjusted risk premia for the market portfolio and all relevant state variables, as opposed to the usual risk premia for cash assets. Our results are shown not to depend on the usual cash‐and‐carry relationship, which, in general, does not hold. We, nevertheless, provide a well‐known special case where it does hold, albeit not grounded on the usual no‐arbitrage argument. © 2003 Wiley Periodicals, Inc. Jrl Fut Mark 23:817–840, 2003     

Do standard scales work in older samples?

In a study of 185 adults ranging in age from 21 to 80 years, it was found that the older subjects' (ages 50 and above) responses on Zaichkowsky's ten-item, bipolar adjective, semantic differential, Personal Involvement Inventory were less internally consistent than the younger participants' responses. In addition to lower reliability, the older adults were more likely to omit multiple items in the scale. This was not the case for Likert-style items included in the study. Similar findings have been reported in a small number of other studies using other semantic differential scales. The semantic differential scaling technique needs a thorough examination for its generalizability to older populations.Leisa Reinecke Flynn is assistant Professor of Marketing at Florida State University in Tallahassee, Florida. She wishes to thank Drs. Ronald E. Goldsmith and Charles Hofacker for their helpful insights.     

Consumer Response toward Plus‐Size Models Featured in the Mainstream Media

The rise of the body acceptance movement among consumers has led several brands and media outlets to feature models with diverse body shapes and sizes. However, little research has examined consumer reactions to these nontraditional models. This exploratory study addresses this gap by examining consumer response to three different instances in which a plus‐size model was featured in a popular press magazine. Discourse analysis examined consumer‐generated online comments. Three broad themes were identified that included positive sentiment related to more inclusivity in media representations of women: concern about model body size and health, and questions around how a “plus” size body is defined. This work offers insight into consumer response to plus‐size models, sheds light into how society views the plus‐size body and health, as well as how brands can begin to integrate plus‐size models into marketing and advertising campaigns.     

The determinants of exit in an open economy

In this paper the determinants of exit are investigated for the manufacturing sector of the United States economy, which has been subjected to growing international influences. The analysis uses United States cross-sectional data. The results of the exit equation suggest that low profitability, declining industry growth, and displacement of incumbents by entrants foster exit. International influences are also seen to have an impact on U.S. manufacturing exit. Specifically, imports into an industry have a small effect on exit and protection has little influence in stemming exit.I would like to thank John Mayo, Don Clark, Ron Shrieves, Robert Feinberg, Joseph Shaanan and an anonymous referee for their comments on earlier drafts of this paper. The views in this paper do not necessarily reflect those of the Commission. The usual caveat applies.     

Do Ethical Values Work? A Quantitative Study of the Impact of Fair Trade Coffee on Consumer Behavior

This study investigates the large French fair trade (FT) market and the importance of FT coffee within it, in an attempt to identify some general features of FT consumers. On the basis of 7,587 transactions, the authors also determine the impact of FT characteristics on customer behavior. The main result is somewhat surprising: FT coffee purchases seem to involve a temporary commitment as FT coffee consumers appear less loyal than traditional coffee consumers. The authors derive some business and academic implications.     

Valuation of Equity-Linked Insurance and Annuity Products with Binomial Models

Abstract

In this paper we develop a valuation method for equity-linked insurance products. We assume that the premium information of term life insurances, pure endowment insurances, and endowment insurances at all maturities is obtainable within a company or from the insurance market. Using a method similar to that of Jarrow and Turnbull (1995), we derive three martingale probability measures associated with these basic insurance products. These measures are agedependent, include an adjustment for the mortality risk, and reproduce the premiums of the respective insurance products. We then extend the martingale measures to include the financial market information using copulas and use them to evaluate equity-linked insurance contracts and equity-indexed annuities in particular. This is different from the traditional approach under which diversification of mortality risk is assumed. A detailed numerical analysis is performed for various existing equity-indexed annuities in the North American market.     

Environmental Management Systems in Outdoor Recreation: A Case Study of a Forest Enterprise (UK) Site

Management of environmental impacts is a key requisite to achieve sustainable tourism and recreation; and Environmental Management Systems (EMSs) provide the framework to assess, plan, act upon, control and monitor environmental management and performance. Although a large proportion of tourism and recreation sites would be in a position to work towards an EMS, few of them are aware of what they need to do to implement such systems. This case study analyses to what extent the elements of an EMS are present in the current management of a Forest Enterprise site in the UK providing outdoor recreation, promoting nature conservation and producing timber. This paper demonstrates how an EMS can be applied to put a structure to the management of a multi-purpose site, and concludes that this site, representative of other Forest Enterprise sites, can meet the basic demands of an EMS.     

Further reading

On the Dynamics of Growth and Debt By Casper van Ewijk Clarendon Press, Oxford, 1991. viii + 220pp. ISBN 0 19 828346 6.

Hillier, B. (1991), The Macroeconomic Debate: Models of the Closed and Open Economy. Basil Blackwell, Oxford.

Citizens, Consumers and Councils By John Gyford Macmillan, London, 1991. 215pp. Hard cover £35.00, ISBN 0 333 52534 5; paper cover £9.99, ISBN 0 333 52535 3.

Trapped in Poverty ? Labour‐Market Decisions in Low‐Income Households By Bill Jordan, Simon James, Helen Kay and Marcus Redley Routledge, London, 1992. 350 pp. £40.00.

Politics and Policy‐Making in Northern Ireland By Michael Connolly. Philip Allan, Hemel Hempstead, 1990. 178 pp.